With counter offers being received by the original shareholders, it is said that Bell South has been trying to wriggle out of the deal. As a result, the Bharti group has taken Bell South to court, in order to ensure that it fulfils its contractual obligation of selling its 24.5 per cent in Skycell to Bharti.

When Bharti initially signed up with Crompton Greaves, Skycell’s value, including loans and liabilities of $35 million, was fixed at around $80 million. After the deal, it is understood that other players, like Hutchison, have bid higher amounts in the range of $140 million, for the same circle.

While Mr. K.K. Nohria of Crompton Greaves agreed that they had received verbal offers from Hutchinson to this tune, Crompton will still honour the commitment to the Bharti group. It is also understood that, as a result of Hutchison’s counter-bid, Bharti has had to increase its offer to $115 million, including the $35-million liabilities.

Skycell has over 28,000 subscribers at the end of June. The other operator, RPG, has over 37,000.
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PriceWaterhouse values Max India investments at Rs 464-510 crore
New Delhi: Commissioned by Max India to value its investments in joint ventures and existing businesses, noted consulting firm, PriceWaterhouseCoopers, has valued the company’s investments in these areas at Rs 464-510. The book value of these investments stand at about Rs 178 crore.

Max India had commissioned PwC to undertake an independent value analysis of these investments in order to determine their fair value and for the sake of greater transparency. Value analysis is based on estimates of future financial performance or opinions that represent reasonable expectations at a particular period of time.

Among the major investments, PwC has valued Max India’s 6 per cent stake in Hutchison Max Telecom Ltd at Rs 140-155 crore; its 47 per cent holding in Comsat Max at Rs 60-65 crore; its 30 per cent stake in Avnet Max has been valued at Rs 20-23 crore and its 50 per cent holding in Max Atotech has been valued at Rs 14-16 crore.

Apart from these joint ventures, the firm has placed an enterprise value of Max’s speciality products business division at Rs 46-52 crore against net investment of Rs 39 crore. The enterprise value of the pharmaceuticals business has been valued at Rs 130-145 crore against a book value of Rs 62 crore.

While Max has identified healthcare, life insurance and IT as its three major thrust areas, with the exception of IT where it has acquired equity in three companies, it has so far not committed any significant funds in these projects. The total investment earmarked for these investments is approximately Rs 675 crore.

PwC is said to have carried out its value analysis exercise on the basis of a Discounted Cash Flow approach, the Market approach and the Underlying Assets approach. However, in the case of Hutchison Max Telecom and Max GB only a limited scope value analysis was carried out.
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Reliance starts ahead of the block in Karnataka’s IT linkup
Bangalore: Despite several companies having evinced interest in the high-profile IT backbone business in Karnataka, only Reliance Industries is said to have moved ahead with concrete plans to complete the initial processes with the state government.

The company is said to have given the government its Rs. 1 crore bank guarantee, alongwith the digging fee of Rs. 2 lakh per km per duct, thus paving the way for it to start road digging work for a nearly 200 km circuit in Bangalore till July 30. It also proposes to use the latest non-invasive techniques to dig up the roads to prevent any major damage to the surface.

The other major player, the BPL Broadband Network-led consortium of IT backbone players (comprising Bharti, Spectranet, Incable and Spice Telecom) is said to be waiting for the local government to reduce the road digging-duct laying price before moving in.

In a parallel move, energy multinational major, Enron, which is targeting the aerial route, has submitted a detailed proposal to Karnataka Power Transmission Corporation for the right of way to use its towers/poles to lay the fibre cable on the Belgaum-Bangalore stretch.
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Voltas likely to restructure to create two business units
Mumbai: Addressing the shareholders of the company, Voltas chairman, Mr. Ishaat Hussain, stated that the company may be split into two distinct businesses. While one unit will concentrate on growth through manufacture, brand and product development (namely unitary cooling products), the other business will cater to light and heavy infrastructural projects. Voltas has identified unitary cooling products, pumps and projects, materials-handling and textile machinery as substantial growth areas for the company.

The company also plans to leverage the engineering, procurement and construction (EPC) skills of Voltas International on a selective basis in infrastructural projects, sophisticated project- management technologies and global sourcing.
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